Crude prices dive 5 percent to lowest in a month

Published 4:35 pm, Wednesday, June 7, 2017

Pumpjacks work in an oil field at sunset after a thunderstorm passed through the area, Monday, June 5, 2017, in Karnes City, Texas. (AP Photo/Eric Gay)

Pumpjacks work in an oil field at sunset after a thunderstorm passed through the area, Monday, June 5, 2017, in Karnes City, Texas. (AP Photo/Eric Gay)

Photo: Eric Gay, STF

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A rainbow appears over an oil field after a thunderstorm passed the area, Monday, June 5, 2017, in Karnes City, Texas. (AP Photo/Eric Gay)

A rainbow appears over an oil field after a thunderstorm passed the area, Monday, June 5, 2017, in Karnes City, Texas. (AP Photo/Eric Gay)

Photo: Eric Gay, STF

Image 3 of 3

Crude prices dive 5 percent to lowest in a month

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Oil prices plunged to the lowest point in a month on Wednesday as the market grappled with a stunning rise in oil and fuel stockpiles.

Traders reeled after the Energy Department reported a 6.6 million barrel combined increase in both oil and gasoline inventories, signs of tepid gasoline demand in the United States despite the start of the summer driving season, a period expected to draw motorists to the pump.

"That was the back-breaker," said John Kilduff, an oil market analyst at Again Capital."When gasoline demand is weak, it's going to take down the whole complex."

U.S. oil prices plunged more than 5 percent on Wednesday to $45.72 a barrel on the New York Mercantile Exchange, its largest drop since early March.

Prices fell despite tensions between Qatar and Saudi Arabia -- some the world's largest Middle Eastern oil producers -- a terrorist attack in Iran and a recent OPEC deal to stem the world's oil glut by extending production cuts for another nine months.

OPEC's deal to extend oil production cuts late last month disappointed traders who had hoped the Saudi-led group would cut deeper into the oil oversupply that has kept crude prices low for nearly three years.